India Inc. urges apex bank to cut key lending rates

 New Delhi, May 31: Ahead of the Reserve Bank of India’s (RBI) bi-monthly monetary policy review, industry lobby Federation of Indian Chambers of Commerce and Industry (FICCI) on Sunday urged the apex bank to cut key lending rates and ease the monetary policy. “Revival of capex (capital expenditure) is critical to push the growth further and create new employment avenues,” said Jyots Suri, president of FICCI. “While the government has given a push to public investments in infrastructure, private investments are still languishing on account of low capacity utilisation and weak consumer demand,” Suri cited. According to the industry body, successive rounds of its business confidence survey have shown that investment outlook remains cautious, with majority participants citing availability and cost of credit to be a major constraining factor.

FICCI reasoned that the reduction in lending rates by fincial institutions is the need of the hour, which has also been acknowledged by Fince Minister Arun Jaitley and the chief economic adviser recently. “With inflation largely under control, we expect the central bank to reduce the repo rate by at least 50 basis points to expedite revival of private investments and demand for housing, automobiles and consumer durables,” Suri said.  (IANS)